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Retirement Planning: A Top Priority For Women
by
Susan Posey |
Many investors underestimate their
retirement needs and are not adequately prepared. For women, it is particularly
important that retirement planning be a top priority -- because they not only have a
longer life expectancy than men, but they also are less likely to be covered by a pension
plan.
If you are a non-working wife, can you count on your husband's benefits to cover you in
retirement? If you work, do you know how much pension you will receive compared to
your husband's? These are some important facts for women to consider:
- Women working full time earn about 12% less than full time male workers.
- The median annual income for women over 65 is only $8,200.
- 75% of all women are not eligible for pension benefits.
- Women live an average of 7 years longer than men.
- Women are much more likely to interrupt their careers to raise a family or care for
older or sick relatives than men are, with the result that any pension or Social Security
benefits they are eligible to receive are reduced.
- The average Social Security benefit for a woman is 25% lower than the average man's
benefit.
- The average age of widowhood is 56.
If you are concerned about having enough money for retirement, here are some ideas that
can help you prepare for a financially secure retirement:
- Begin now to save for retirement - Whether it's a company-sponsored salary deferral
plan, such as a 401(k), a small business retirement plan for the self-employed, an
Individual Retirement Account (IRA), or a spousal IRA for one-income married
couples. Even if your contributions aren't tax deductible, earning will be
tax-deferred.
- Invest regularly - Even if the amount is small in the beginning.
- Diversify your investments - Don't put all of your savings into a single
investment. By diversifying, you may be able to minimize risk -- maybe even increase
returns.
- Consider rolling over any lump-sum distributions - When leaving an employer, if you
roll-over funds from your qualified retirement plan into an IRA this will ensure the money
keeps growing tax-deferred until retirement, as well as saving a substantial amount in
federal withholding taxes.
- Consider your life span - At retirement, married couples and single women should
consider retirement plan distributions that take into account women's longer life spans.
Susan Posey is an Investment Consultant
with IJL Wachovia in Columbus, Georgia. IJL Wachovia, a division of Wachovia
Securities, Inc., is one of the nation's largest regional full service brokerage firms,
offering a full range of investment services to investors. |
